Have Insiders Been Buying SANVO Fine Chemicals Group Limited (HKG:301) Shares?

We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell SANVO Fine Chemicals Group Limited (HKG:301), you may well want to know whether insiders have been buying or selling.

Do Insider Transactions Matter?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.

We don't think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.

View our latest analysis for SANVO Fine Chemicals Group

SANVO Fine Chemicals Group Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Chief Technical Engineer & Executive Director Bingyao Chen bought HK$987k worth of shares at a price of HK$1.13 per share. So it's clear an insider wanted to buy, even at a higher price than the current share price (being HK$0.90). While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. We always take careful note of the price insiders pay when purchasing shares. Generally speaking, it catches our eye when an insider has purchased shares at above current prices, as it suggests they believed the shares were worth buying, even at a higher price. Bingyao Chen was the only individual insider to buy during the last year.

The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

SANVO Fine Chemicals Group is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. SANVO Fine Chemicals Group insiders own 74% of the company, currently worth about HK$283m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About SANVO Fine Chemicals Group Insiders?

It doesn't really mean much that no insider has traded SANVO Fine Chemicals Group shares in the last quarter. However, our analysis of transactions over the last year is heartening. With high insider ownership and encouraging transactions, it seems like SANVO Fine Chemicals Group insiders think the business has merit. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing SANVO Fine Chemicals Group. Case in point: We've spotted 4 warning signs for SANVO Fine Chemicals Group you should be aware of.

Of course SANVO Fine Chemicals Group may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.

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This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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